J&K HC Quashes No-Tender Award Of Channi Himmat Toilet-Complex Work, Orders Fresh Tender Process

The petitioner challenged Jammu Municipal Corporation’s allotment, by order dated 8 April 2013, of a toilet-complex construction project at Channi Himmat to respondent No. 6 without inviting tenders.

The Corporation maintained that respondent No. 6 was an experienced, empanelled NGO, and that earlier tendering attempts had been unsuccessful.

The petitioner sought quashing of the allotment and a fresh process inviting tenders.

Respondent No. 6 did not appear and was proceeded against ex parte.

Article 14 requires State instrumentalities to act fairly, reasonably and transparently when distributing public largesse and awarding public contracts.

Ordinarily, such contracts should be awarded through public auction or an advertised tender process that affords eligible persons equal opportunity and promotes transparency and competition.

Relying on Nagar Nigam, Meerut v. Al Faheem Meat Exports Pvt. Ltd. & Ors., (2006) 13 SCC 382, the Court stated that public authorities cannot distribute largesse at their discretion or exercise statutory functions arbitrarily; departure from the ordinary tender process requires a valid justification.

The toilet-complex project was a public work involving public funds, so the Corporation was required to provide a fair and competitive opportunity to eligible participants.

Respondent No. 6’s experience and empanelment did not give it an exclusive entitlement to the contract or, without more, justify dispensing with tenders. The Corporation identified no exceptional circumstances or statutory authority supporting direct allotment.

The petitioner’s failure to make a prior approach to the Corporation was immaterial to whether the public authority had acted transparently and lawfully.

The Court therefore found the allotment arbitrary and contrary to Article 14.

It directed the respondents to undertake the allotment process afresh, in accordance with law, by inviting tenders and opening the work to competition.

The petition was allowed, with no order as to costs.